World View & Market Commentary. Forest first; Trees second. Focused on Real & Knowable facts that filter through the "experts" fluff and media hyperbole. Where we've been, what the future may hold and developing a better way forward.

Monday, July 3, 2017

As predicted in my article “Bitcoin Breakout Coming”, published last Thursday, June 29th, I stated, “This pennant WILL resolve not later than about July the 5th…”

LIGHTCOIN

Overnight Lightcoin led the way with a definitive breakout, and is now approximately 20% higher than it was yesterday!

Note, too, that on June 29th I stated, “I expect that mathematically this ratio will close over the coming years to get closer still to that 4 to 1 ratio. That means that I expect Litecoin to outperform Bitcoin in percentage gains from this point forward in the long run.”

Back on June 8th I also stated about Litecoin, “Litecoin is another cryptocurrency designed to be “silver” compared to Bitcoin’s “gold.” There will only be 84 million Litecoins ever mined, exactly 4 times the amount of Bitcoins. However, Litecoins are currently trading for roughly 1/100th the price of Bitcoin, I would expect the math to eventually catch up as more people become aware of Litecoin’s also limited supply.”

Today that ratio has already closed to 54.7. I will be watching this ratio to make sure that it doesn’t get ahead of itself. This is a great example where paying attention to simple math pays off, and actually reveals insight into the future.

On Litecoin’s breakout at $39, I am now targeting this leg up to reach $67 before the next major round of consolidation, this is IF the length of the mast is equal. Also beware that retests of the breakout are possible.

BITCOIN

Bitcoin has also broken out of its pennant formation, although not as definitively:

I expect that if this breakout holds from here, the target should be in the $4,300 range over the next couple of months.

ETHEREUM

Ethereum, however, is still within its flag and has not yet broken out in either direction. Although Ethereum has performed well over the past couple months, its quantity is not strictly limited as are Bitcoin and Litecoin. I would still acquire on a break out of this formation higher.

A WORD ABOUT WAVES

In nature, all waves require a DIFFERENTIAL of some sort to exist. That differential can be temperature, pressure. These differentials are the ROOT OF ALL ENERGY.

If the universe was 100% homogeneous, there would be no energy, no matter, no us.

Once a differential exists, then energy potential exists. This potential leads to movement as everything moves from high pressure to low. This is the genesis of motion. Motion is a requirement of matter!

Once you begin to think in terms of differentials, then you will see energy potential, and you will then understand the movement of waves resulting from those differentials. Those waves rule everything, including our man-made constructs that we call “markets.”

The differential most noticeable to me at this moment is the fact that our bond market interest rates are moving strongly higher. This creates an energy differential with nations whose rates have not moved higher in unison. As that occurs, our higher rates attracts money, and that is a wave that can, and has, moved our already overvalued markets higher still.

Math is a descriptor of these differentials – embrace the math, it provides a window to the future!